Taxation of Chargeable Gains Act 1992 Schedule 5B paragraph 19

Interpretation

Schedule 5B paragraph 19 provides the definitions and interpretation rules needed to understand and apply the EIS deferral relief provisions throughout the Schedule.

• Key terms such as "eligible shares", "qualifying company", "associate", "bonus shares", "period of restriction" and "termination date" are each given specific definitions, many by cross-reference to the EIS income tax relief legislation
• "The relevant shares" are the shares the investor acquires as the qualifying investment (and still holds at the time the original gain accrues), extended to include matching bonus shares and replacement shares issued on a company reorganisation
• "Deferral relief" is treated as attributable to shares only where expenditure on those shares has been set against a gain under the Schedule and no chargeable event has yet occurred in relation to them
• Supplementary rules clarify that an "issue" of eligible shares means shares of the same class issued on the same day, that shares are only of the same class if they would be so treated on the Stock Exchange, and that shares are not regarded as issued merely because they appear in a letter of allotment